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Struggling Intel potentially looking at selling off cyber security division

Leading chipmaking company Intel is reportedly looking at potentially selling its antivirus software maker, formerly known as McAfee, which it purchased for approximately $7.7 billion (£5.8 billion) six years ago.

According to a report in the Financial Times, Intel has been reportedly talking about selling its cyber security section of the business, in what would arguably be the largest in the sector, according to sources close to the discussions.

The report comes after several high-profile cyber security company sales this year, including Blue Coat Security being sold by Bain Capital to Symantec for $4.6 (£3.4 billion dollars), which was almost double than what Bain Capital paid for the company a year ago. A similar purchase by Vista Equity Partners occurred when they bought Ping Identity, a secure authentication service at the beginning of June this year.

One of the main reasons for this is the increase in consolidation of the cyber security market that is occurring. With the surge in cyber attacks, particularly in 2014 and 2015, and new attacks that older companies were unable to deal with, the sector began buying up smaller start-ups for either their technologies or the talented workforce that come with these companies, particularly engineers.

Intel purchased McAfee in 2010 and promised to embed the cyber security functionality that McAfee offered on to the chips Intel makes. This would then, the company promised, be able to detect cyber attacks on a much deeper level. However, six years on Intel has not done anything with McAfee, and two of the Intel Security chief executives have left to form their own cyber security companies.

With Intel struggling in the declining PC market, it has already cut 12,000 jobs and is shifting its business focus to provide chips for cloud computing than just PCs. As part of this, it could be tempted to sell the cyber security arm of its business with a number of private equity buyers reported to be keen.

Filed in: News

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